FirstCry-Backed Swara Baby Gets SEBI Approval for Rs 1,000 Crore IPO

Swara Baby, a contract manufacturer of disposable hygiene products and a company backed by FirstCry parent BrainBees Solution, has received approval from SEBI to launch its proposed Rs 1,000 Cr IPO.

The IPO will have a fresh issue of shares worth up to Rs 500 Cr and an offer for sale (OFS) of up to Rs 500 Cr. The equity shares will have a face value of Rs 2 each.

BrainBees to Sell Rs 300 Cr Stake

Under the OFS, promoter selling shareholder BrainBees Solutions will sell shares worth up to Rs 300 crore.

Another shareholder, Anadya Bon Merchari LLP, will sell shares worth up to Rs 200 Cr.

The IPO will therefore give existing shareholders an opportunity to partially sell their holdings, while Swara Baby will raise fresh capital for its business expansion and financial needs.

New Manufacturing Plant in Madhya Pradesh

A major portion of the IPO proceeds will be used to expand Swara Baby’s manufacturing capacity.

The company plans to invest around Rs 198.2 Cr in setting up a new manufacturing facility in Madhya Pradesh.

The new plant is expected to help the company increase production capacity and support its future growth in disposable hygiene products.

Rs 100 Crore for Debt Repayment

Swara Baby also plans to use around Rs 100 Cr from the IPO proceeds to repay or prepay some of its existing borrowings.

Another Rs 27.5 Cr will be invested in its subsidiaries - Solis Hygiene, Swara Hygiene and KAEHPL - for repayment or prepayment of their outstanding borrowings.

The remaining funds will be used for inorganic growth opportunities, including acquisitions that have not yet been identified, along with general corporate purposes.

Pre-IPO Placement Also Possible

Swara Baby may also consider a pre-IPO placement of up to Rs 100 Cr, subject to discussions with its book-running lead managers.

If completed, the pre-IPO placement could impact the final size of the fresh issue.

JM Financial and Avendus Capital are acting as the bankers to the IPO.

Key Numbers

• Rs 1,000 Cr - total proposed IPO size
• Rs 500 Cr - fresh issue and Rs 500 crore OFS
• Rs 198.2 Cr - planned investment in the new Madhya Pradesh plant

Swara Baby’s IPO comes as the company looks to expand its manufacturing capacity, reduce debt and explore acquisitions. With the SEBI approval now in place, the FirstCry-backed company is moving closer to entering India’s public markets.

The Unicorn Magazine